Rugby dispute puts San Diego, other pro teams in limbo

San Diego Breakers players greet fans at Torero Stadium after a game in May 2016.

San Diego Breakers players greet fans at Torero Stadium after a game in May 2016. (Chadd Cady / San Diego Union-Tribune)

Tod Leonard

A rugby scrum is that portion of the game where opponents dip their head and shoulders into each other, one human force — driving and grunting — meeting another in a display of stubborn athleticism.

It turns out that in American rugby, they don’t keep that kind of head-butting on the pitch. It has bled into boardrooms from San Diego to Colorado to New York City.

It was a year ago this week that the first match was played in the inaugural season of the five-team PRO Rugby North America league – the first professional outfit to be sanctioned by USA Rugby, the sport’s governing body in the United States.

On April 23, the San Diego Breakers opened their 12-game campaign (they’d finish 4-8) with a victory over Sacramento in front of a lively announced crowd of 2,500 at USD’s Torero Stadium.

Those in attendance – many of them hardcore rugby enthusiasts – believed they were watching the dawn of a new era – one in which their own children might one day aspire to get paid to play the sport without crossing an ocean to do so.

As this spring arrived, with no 2017 schedule for PRO Rugby or any solid signs there would be a Season Two, many of those same fans were wondering: What the heck happened?

“It’s just very disappointing,” said Ray Egan, the Irishman who was San Diego’s head coach. “I still believe pro rugby could actually continue because the money is there. It’s just a matter of everyone getting around a table and agreeing about a way to move forward and how best to support each other, rather than saying, ‘What’s in it for me?’ ”

At the center of the storm is PRO Rugby founder Doug Schoninger, a New York financier who didn’t know anything about rugby until an Australian friend sold him on its viability as the next great pro sport in America.

In 2015, Schoninger hammered out the first-ever pro sanction deal with then-USA Rugby chief Nigel Melville, and a handful of people did the improbable in just a few months by finding venues and signing players from around the world to play in San Diego, San Francisco, Sacramento, Denver, and Obetz, Ohio (near Columbus).

But the cracks in the foundation began to show barely after the season had begun. Melville resigned in late April and was replaced in July by Dan Payne, a former rugby player from New York whose club experience included playing for San Diego’s storied OMBAC. For a time, Payne also coached San Diego State’s men’s club team.

Schoninger now contends that Payne has refused to provide any of the support that Melville offered in their initial agreement. USA Rugby’s three-year sanctioning deal with PRO Rugby expires in April 2018, and Schoninger maintains that Melville intended to extend the exclusive rights to 12-man rugby in America once he saw that Schoninger could pull off a first season.

Instead, Schoninger said he has been shut out of talks with USA Rugby while hearing persistent rumors of other teams and leagues hoping to make professional inroads into the United States.

USA Rugby has acknowledged discussions with Pro12, the European professional league, about putting a team in a city on the East Coast, while the Austin Huns, a successful program in Texas, are talking about forming their own pro league with other top clubs.

That is unacceptable to Schoninger, who said a year ago that he was committing $7 million to $8 million for the first season, with plans to spend as much as $25 million to $30 million in the first three years.

“There’s really been a switch in their thought process about how they think rugby should grow in America, and I think they’re wrong. They are 100-percent wrong,” Schoninger said last week in a phone interview with the San Diego Union-Tribune.

“It’s not in their interest to have an open debate,” Schoninger said of USA Rugby. “All I need is what they promised me – a long enough runway to lose money, and then to be able to recover that. What they wanted was for us to build the brand, lose money, and then yank our exclusive sanction. That’s the dispute, basically.”

Schoninger and Payne had their last substantive meeting in December, and they could not come to an agreement on how to move forward at that time. Since then, Schoninger said, any inquiries he’s made have been referred to USA Rugby attorneys.

Repeated attempts by the Union-Tribune to speak to Payne were unsuccessful, though Payne did leave this voicemail message for a reporter: “As you know, we don’t have much to do with the league’s plans and what they want to do. We’re hoping for a second season. We haven’t been told there’s not going to be one … we just haven’t been given any definitive schedules or venues or teams yet. The ball is in PRO Rugby’s court.”

Sensing any long-term support by USA Rugby was deteriorating, Schoninger terminated the players’ 12-month contracts in December, three months shy of their end date. A player from the San Francisco team, Jack O’Hara, along with his head coach, Paul Keeler, have filed grievances with the California labor board.

The San Francisco team was folded by Schoninger in December, citing venue problems, a week before he notified the players of the termination of their contracts.

Steve Lewis, PRO Rugby’s director who put together all of the teams for the inaugural season, left the organization in October and subsequently sued Schoninger for salary and expenses he said he was owed.

USA Rugby, meantime, has its own money problems. Payne has said the organization started 2017 with a $1 million deficit, due to the bankruptcy of its uniform sponsor, BLK, and the poor European currency exchange rates. USA Rugby is funded by grants from England-based World Rugby.

Schoninger maintains that one of the primary faults in the American rugby system is that it’s controlled by a governing body of amateurs whose vision doesn’t jibe with someone trying to start a professional league.

He said USA Rugby shows little interest in modernizing the game for television or understanding that pro rugby needs to be about attracting the best players from around the world and not just developing athletes who will play on the national teams.

“USA Rugby’s goal is to have the best national team,” Schoninger said. “I thought we could do that in tandem, but that’s probably not possible. Our mandates are different.

“In order to grow the game, you have to go outside the (rugby) community. And as long as they just serve their community, they’re never going to grow the game. I don’t think they understand that distinction.”

PRO Rugby’s first season could be termed a tepid success, attendance-wise. The league’s announced average per game was 1,723 — below the 3,000 it said it needed to break even. With a base ticket price of $40, San Diego ranked third of the five teams with a 1,916 average.

There was scant marketing in the league’s cities, other than on social media among rugby clubs, and a television deal had yet to be worked out.

Payne spoke of the ball being in PRO Rugby’s court. That possibly will become the court of law. Schoninger said he may file lawsuits.

“When we sue them, they’re going to cry – ‘I can’t believe they’re suing us!’ ” he said. “We don’t want to sue you. We want to have a friendly negotiation. But this is like suicide by cop. They want us to sue them so they can complain about me.”

As for a second season of PRO Rugby in 2017, Schoninger maintains that it’s a possibility, though anything that looks like the first season is impossible at this point.

“We’ll definitely have a second season,” Schoninger said. “When that is and what it looks like is up to us.”

San Diego doesn’t appear to be part of the immediate plans. Josh Lawrence, USD’s associate athletic director of facilities and operations, said PRO Rugby paid its bills for the 2016 season but “weren’t interested in the summer of 2017.